Since 2017 any trust with a tax liability has been required to register on the HMRC Trust Register. Registrable taxable trusts created before 6 April 2021 must register by 5 October in the tax year after becoming liable to income tax or capital gains tax for the first time (31 January in the following tax year for other taxes).
New rules introduced by the EU fifth money laundering directive mean that it is now a legal requirement to register any UK trust deliberately created (express trust), even if there is no tax liability; for example, bare trusts.
Also, existing trusts already on the register will need to add extra data, being country of residence, nationality, and the nature and extent of a beneficiary’s interest.
Non-UK express trusts must register if they acquire an interest in UK land or if they have at least one UK trustee and they enter into a business relationship with a UK adviser who is subject to money laundering regulations.
You may be unaware that you are a trustee or settlor of a trust and, therefore, it would be wise to liaise with your financial advisor and or solicitor to check whether you have previously made an investment that has been put into a trust wrapper. The trustee may be legally obligated to register these investment trusts.
There is a list of types of trusts excluded from registering, ranging from: life insurance policies without a surrender value; trusts arising on intestacy; pension scheme trusts; charitable trusts; co-ownership trusts of jointly held property where the trustees and beneficiaries are the same persons (for example, joint bank accounts or land and property held as tenants in common).
Trusts can be registered through HMRC’s website and you must use your government gateway account. Information is required on the trustees, settlors, and beneficiaries such as dates of birth and national insurance numbers.
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An Agent can register a trust on behalf of the trustees, but if you wish your Agent to handle any future updates to the register, you must complete HMRC’s ‘digital handshake’ to authorise them.
HMRC will hold the details of the registration but access will be restricted to various law enforcement agencies.
The deadline for reporting a registrable non-taxable express trust, which was in existence on 6 October 2020, is 1 September 2022. Non-taxable trusts created after 6 October 2020 must register by 90 days of being created or 1 September 2022, if later. Thereafter, trusts should be registered within 90 days of creation and trustees should update the data on the register within 90 days of becoming aware of any changes.